Biggest Africa Refinery Has $113 Million Less Gold Than in Books

July 25 (Bloomberg) -- Rand Refinery Ltd., processor of
about a third of the world’s gold since 1920, found $113 million
less physical metal than the company had booked in its accounts
after adopting a new computer system.

The refinery in Germiston, a town 20 kilometers (12 miles)
east of Johannesburg, has 87,000 ounces of physical gold less
than the amount present in its accounting records after
“implementation difficulties” with the new system, the company
said in a statement today. That’s worth about $113 million at
today’s price of $1,296 an ounce.

Rand Refinery’s shareholders, including AngloGold Ashanti
Ltd., Sibanye Gold Ltd. and Harmony Gold Mining Co., agreed to
lend the company 1.2 billion rand to help make up the
difference. Howard Craig resigned as chief executive officer in
May and has been replaced by Mark Lynam, who is being assisted
by management consultant Accenture Plc in sorting out the issue.

Gold miners send bullion at about 80 percent purity to the
refinery, which then treats it and boosts this to close to 100
percent. Rand, Africa’s biggest processing facility for the
metal, has refined almost 50,000 metric tons of gold since 1920,
according to its website.

The miners, customers of the refinery, have received the
prices they were expecting, leading them to conclude it’s most
likely an accounting problem rather than theft, James Wellsted,
a spokesman for Sibanye Gold, said by phone.

AngloGold, Sibanye and Harmony made loss provisions of
about $92 million between them as a result of the lost ounces.
Rand Refinery has been unable to finalize its results for the
year ended September 2013 because of the issue, it said.